Bitcoin is experiencing a major correction despite high net inflows into spot ETFs. Cryptoanalyst Willy Woo has shared your opinion on the recent BTC price drop. In his recent post on
Bitcoin is experiencing a major correction despite high net inflows into spot ETFs. Cryptoanalyst Willy Woo has shared your opinion on the recent BTC price drop. In his recent post on
Who sells?
Woo notes that while ETFs and institutions are actively purchasing BTC, focusing solely on ETF flows is incorrect. The main sellers, according to Woo, are the “OGs”, that is, the original holders of BTC. These early adopters hold significantly more BTC than all ETFs combined and tend to sell during each bull market.
The chart reveals a recognizable pattern that appears during the bull runs of each cycle.
Paper is everything
The introduction of paper BTC through futures markets since 2017 has significantly altered market dynamics. Paper BTC allows traders to buy synthetic BTC without holding real BTC, diverting direct demand from real BTC.
In the past, the price of Bitcoin skyrocketed because only long-time holders and miners sold BTC. However, the 2022 bear market was influenced by a rush of paper BTC, despite minimal selling by spot holders. Woo notes that current conditions show periods where an increase in paper BTC does not lead to a price rally, highlighting the impact of synthetic BTC.
Arman ShirinyanWoo maintains that understanding BTC market dynamics requires analyzing on-chain data, derivatives data, and technical price action.
Therefore, focusing solely on buying ETFs is insufficient; A broader view is necessary to capture the full picture of supply and demand.
